Why Liberals Hate the New Simpson-Bowles Deficit Reduction Plan

The short and obvious explanation is that the revamped proposal emphasizes spending reductions, which is a blow to Democrats' false mantra du jour; namely, that the country doesn't have a spending problem. The Atlantic's Derek Thompson gripes that the new bipartisan framework, advanced by the former co-chairmen of President Obama's fiscal commission earlier this week, emits a distinct whiff of Republicanism. The MSNBC crew is predictably unimpressed, as are lefty bloggers like Matt Yglesias. Conservative economist Kevin Hassett (who goes out of his way to describe his own misgivings over Simpson-Bowles 2.0) explains why the president's ideological kin probably regret his decision to assemble the commission in the first place. Pretending to care about deficits, then utterly ignoring the advice of the council you charged with fashioning a workable way forward, has its consequences -- as does basic budgetary math, it turns out:

This new plan calls for about $1 trillion more in total spending cuts than was previously sought by the two gentlemen; in addition, the tax revenue they seek is about half of what was contained in their original plan. It seems that Simpson and Bowles have moved in the Republicans’ direction big time. Their plan emphasizes the pressing need to contain the debt and makes it clear that spending cuts are necessary to do so, something Democrats have seemed to be woefully ignoring in recent months. This shift in position clearly suggests that they were strong armed by the president the first time around, and forced to push a plan that they viewed was harmful for the economy. Despite making concessions towards higher taxes, they were double crossed by Obama, who dropped their plan the minute it was delivered. Overall it seems like this exposes a big gap between Simpson and Bowles and the president. President Obama has pretended to be an advocate of their position, but never been serious about doing anything. This is payback time, and Simpson and Bowles have not made any friends in the White House today.

At the other end of the spectrum, the Heritage Foundation has also come out against the new plan, arguing that it relies too heavily on increased tax revenues and does not include necessary structural reforms to entitlement programs. These are definitely valid concerns, but I think they miss the forest for the trees. Simpson-Bowles 2.0 has zero chance of becoming policy reality, chiefly because Democrats would never allow it to see the light of day. Still, it offers several relevant openings for conservatives: (1) It again highlights the serious and systemic crisis of long-term government debt. (2) It correctly identifies overspending as the prime culprit and driver of this problem, powerfully refuting the denialists. (3) It tilts the solution towards spending reductions and de-emphasizes the revenue component, perhaps because the president just enacted a $600 billion tax increase. (4) It does all of these things through a pristine prism of bipartisanship, as established by the president himself. Alan Simpson and Erskine Bowles cannot be dismissed as right-wing cranks or knee-jerk partisans. Their reputational heft and credibility can therefore be leveraged by conservatives to demonstrate that their policy solutions are based on fiscal realities that undergird the bipartisan consensus -- which Democrats have taken to flatly denying. In short, Simpson-Bowles 2.0's underlying assumptions and broad remedies can be wielded as an effective cudgel against the denialists' obfuscations and fantasies -- even if conservatives have substantive quibbles over some of its elements. On a related note, Carol has noted the continuation of Howard Dean's fascinating truth-telling campaign, wherein he's been candidly admitting something that his fellow Democrats can't bring themselves to publicly articulate:

“[S]omebody has to tell the middle class that either your taxes are going to go up or your programs are going to get cut or else we're going to go into financial oblivion, and nobody really wants to tell them that.”

Indeed. If Americans really want a more expansive government -- replete with the bells and whistles they say they're averse to trimming back -- they're going to have to pay for it. The big government/low taxes dichotomy cannot endure for much longer, so some tough choices must be made to stave off "financial oblivion," as Dean accurately describes our current unsustainable path. Republicans' plan is to promote economic growth (which partially solves a lot of problems) by keeping Americans' tax burden relatively low while simplifying and flattening the tax code, to scale back the size and scope of the government, and to get a handle on our spiraling obligations through a series of reforms. Democrats, meanwhile, like to pretend that our debt crisis can be averted by asking a little more from "the rich," without cutting back on government in any meaningful way. This is an appealing mirage for many voters, but it's The Big Lie of American politics. And now a well-known former DNC chairman and presidential candidate is joining conservatives in exposing that lie, albeit in the context of calling on drastically higher taxes for everyone. I discussed Dean's remarks with Neil Cavuto last night and urged Republicans to challenge Democratic candidates with his words:

Every Democrat seeking national office should be confronted with some variant of this question: "Candidate X, former DNC Chairman and presidential candidate Howard Dean -- a prominent member of your party -- has said that current and future levels of spending are leading us into financial oblivion, and the only way to avert catastrophe is through significant tax increases on the middle class. Do you agree with him? If not, how specifically would you make the math work?" This is a query that Democrats hope to avoid like the plague. Frankly, it's a major reason why they've deliberately avoided passing a budget for four years; either they can't answer the question, or they don't want voters to know what their plans will require. Either option is unacceptable. I'll leave you with some very thoughtful liberals offering a substantive critique of the new Simpson-Bowles deficit reduction framework:

In no time at all, moderator Mike Allen was interrupted by a middle-aged black man walking close to the stage and yelling, passionately and on-message, "Pay yo' damn taxes!" he said, as security politely corralled him. "Pay yo' damn taxes!" "We'll bring you into the conversation," said Allen diplomatically. Allen tried to continue, letting Bowles introduce the new-old plan, when another middle-aged black man started yelling more slogans: "Some cuts don't heal!" Another ejection, another promise to bring him into the conversation.

These productive outbursts were orchestrated by an offshoot of the SEIU.